Traders said the market was in an "over-bought" position following huge positions built up on optimism over the forthcoming Budget and hopes of faster reforms. With the BSE Sensex rising by a hefty 1,234.85 points in past seven days, some money was taken off the table, they added.

Shares of Reliance Industries (RIL) on Friday witnessed selling pressure, falling over three per cent, after Delhi Police yesterday had detained a RIL staffer in connection with alleged official document theft in the oil ministry.

The BSE Sensex opened lower at 29,446.21 and dropped to the day's low of 29,178.26 and finally settled with a loss of 230.86 points, or 0.78 percent, at 29,231.41. Intra-day, the gauge touched a high of 29,462.09 in morning trade.

The 50-share NSE Nifty moved down by 61.70 points, or 0.69 percent, to finish at 8,833.60 after hovering between 8,816.30 and 8,899.95.

Despite Friday's fall, both the key indices Sensex and Nifty posted a gain on weekly basis.